For digital currency investors, 2018 will be an exciting year.
The end of 2017 concluded in a hype-driven Bitcoin-buying frenzy — one that allowed people to double their gains within just a matter of months.
But today, we're looking at a very different picture.
Bitcoin has fallen from its all-time high, and the overall digital currency market has cooled. But in the wake of Bitcoin's fall, altcoins have gathered steam. And many experts now believe that 2018 will be the year of the altcoin, not Bitcoin.
Hitesh Malviya, the crypto consultant behind ItsBlockchain, believes that we'll continue seeing growth from the altcoin sector in 2018 and that, in the long run, big gains from cryptos will occur outside Bitcoin.
With that in mind, many investors are looking at altcoins rather than Bitcoin for the coming year.
With over 1,500 digital currencies on the market, it can be hard to find a winner.
And that's why Token Authority's research team has put together a resource page to highlight a few of the altcoin technologies we find most promising...
1. Ethereum (ETH)
In 2017, Ethereum (ETH) skyrocketed to new all-time highs alongside Bitcoin.
The rumor mill was churning with investors speculating over whether or not Ethereum would overthrow Bitcoin's market cap by the end of the year.
Sadly, 2017 was not the year that Ethereum would surpass Bitcoin. But 2018 is looking far more likely.
Here are a few reasons why...
For starters, of all the digital currencies on the market, Ethereum may be best positioned to steal Bitcoin's crown.
With a wide range of applications and a lightning-fast transaction rate, Ethereum was designed to give Bitcoin a run for its money. Ethereum is much more than just a digital currency: It's also a powerful open-source tool for developers.
Ethereum was founded in 2015 by web developer Vitalik Buterin, who is now one of the most famous players in the digital currency world.
Through his work with the Bitcoin blockchain, Buterin recognized the shortcomings of the world's first digital currency.
Ethereum was the remedy to those problems. We cover all the reasons for why Ethereum is better than Bitcoin in our Ethereum resource page, which you can access here.
For now, just know that Ethereum has more potential applications and a faster network, which have set it up as a better technology.
Secondly, the Ethereum team has also managed to come up with solutions for areas where the Bitcoin core has struggled. By that, we mean the Ethereum team is actively addressing two of the biggest problems affecting most digital currencies: scalability and energy use.
The Ethereum team is trying to make the transition to a validation method called proof of stake (PoS), which would eliminate miners from the equation and also reduce the energy use needed for maintaining the Ethereum network.
Even though a public date for the transition to PoS hasn't been set yet, investors should keep their ears to the ground as we progress through 2018.
If successful, PoS will mean big things for the Ethereum network, making it the first in a generation of sustainable digital currencies.
You can buy Ethereum on Coinbase, Gemini, Bittrex, and GDAX.
And to learn more about Ethereum, you can access its official website here.
2. Stellar (XLM)
Another promising digital currency for 2018 is a new arrival on the scene: Stellar (XLM).
Well, we shouldn't say "new." Stellar was founded in 2014 by Jed McCaleb and Joyce Kim. That being said, it wasn't until December 2017 that Stellar caught the public's eye, breaking into the top 10 on CoinMarketCap.
One of the reasons that we like Stellar is because of its similarities to Ripple. But unlike Ripple, XLM has technology that can be applied more widely.
For starters, Ripple and its native digital currency, XRP, are primarily used for tools produced by Ripple Labs and are bought by large banks.
Stellar took the Ripple model and brought it back to the people. The goal is to help in facilitating the flow of money between individuals. Stellar does this in a unique way: The network uses a series of partners known as “anchors.”
These anchors are usually banks, and they provide individuals using the Stellar network with funds. Through the use of partners, Stellar makes cross-border payments far easier and more cost-effective.
Say you wanted to transfer money to a friend in Europe. In this situation, you would need to exchange U.S. dollars for euros.
If you completed this transfer on the Stellar network, then the offtake partners would provide the proper funds for less than a penny and in less than six seconds. Best yet, users of the Stellar network also get the best exchange rates, thanks to a decentralized exchange that's built into the network.
The currency associated with the Stellar network is known as Stellar lumens.
Beyond facilitating the flow of money, the Stellar exchange also allows individuals to make their own tokens using the network.
This gives Stellar multiple avenues of value and makes it a serious contender in the 2018 digital currency race.
In fact, Stellar has hurdled many of the shortcomings that have stalled Ripple. Ripple has a limited audience because of it being primarily used by financial institutions.
With its more varied reach, Stellar has a better chance at long-term growth, while still sticking to the decentralized mission that makes digital currencies so popular.
You can buy Stellar on Poloniex, Binance, Bittrex, and Kraken.
And to learn more about Stellar, you can access its website here.
3. IOTA (IOT)
Maybe the most distinct pick in this list, IOTA (IOT) is a technology to be reckoned with.
IOTA is one of the only digital currencies on the market that doesn't rely on blockchain technology.
Despite this, IOTA still managed to whip the tech world into a frenzy, mainly because of its potential to provide a foundation for the "economy of things" (EoT). EoT is best described as a marketplace for all of the data that will be produced by the internet of things (IoT).
IOTA can function like many traditional digital currencies, allowing individuals to exchange funds peer to peer. But its main role is to facilitate the flow of information between machines and people.
In our current world, information is incredibly valuable. It's also being collected constantly. When we fully embrace the IoT, the rate at which we collect information will increase. But much of that information just sits in isolation — it's never monetized.
IOTA tackles this problem from two angles...
First, it assures that the integrity of the data is always protected by providing a decentralized and tamper-proof ledger. Second, IOTA allows for fee-less transactions. This allows people to buy and sell data and technology space without going through a middleman.
To make all this happen, IOTA uses a groundbreaking new technology called "Tangle." Tangle is different from a blockchain and is based on a mathematical concept.
IOTA's team recognized that, despite having many benefits, current blockchain technology can also be very expensive, so it designed Tangle to overcome the issue.
Over 2017, IOTA attracted attention from some major players, including Microsoft, Deutsche Telekom, and Fujitsu.
It's also worth mentioning that the IOTA team just hurdled some major security issues. Back in 2017, the IOTA network fell victim to a massive phishing attack that coincided with a DDoS attack. Hecklers of IOTA's Tangle model were quick to say the breach was an example of IOTA's security flaws.
But because the phishing scam actually had nothing to do with Tangle's security, this is a false accusation.
In 2018, IOTA is still developing technology and forging partnerships. We believe that it could continue moving up from here.
You can buy IOTA on Bitfinex, Binance, and Coinone.
And you can learn more about IOTA on its website.
There you have it! Those are our top altcoin picks for 2018. We're excited to have you join us for a whole new year of investing.
And remember, If you haven't already done so, sign up for our free Token Authority digital currency newsletter. Through our e-letter, we'll keep you up to date on many of the events happening in the digital currency space and provide you with actionable investing research.
Thank you for taking advantage of our free educational content. At Token Authority, our goal is to provide investors with actionable and timely investment research. If you'd like to receive our twice-weekly mailings, including a weekly events roundup, make sure to sign up for our free Token Authority e-letter.
The Token Authority, Copyright © 2019, Angel Publishing LLC. All rights reserved. 111 Market Place #720 Baltimore, MD 21202. For customer service, call (877) 303-4529. The content of this site may not be redistributed without the express written consent of Angel Publishing. Individual editorials, articles and essays appearing on this site may be republished, but only with full attribution of both the author and The Token Authority as well as a link to www.thetokenauthority.com.
No statement or expression of opinion, or any other matter herein, directly or indirectly, is an offer or the solicitation of an offer to buy or sell the securities or financial instruments mentioned. While we believe the sources of information to be reliable, we in no way represent or guarantee the accuracy of the statements made herein. The Token Authority does not provide individual investment counseling, act as an investment advisor, or individually advocate the purchase or sale of any security or investment.
Subscribers should not view this publication as offering personalized legal or investment counseling. Investments recommended in this publication should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company in question. All Investments in Stocks, Options, Bonds, ETFs and Futures may carry a significant risk of loss.